GIFT  OF 


is^t 


^^ 


N  ERRONEOUS 
VIEW-POINT 


BY 


JOHN  E.  BENNETT,  Esq. 


,/^> 


^ 


f^V- 


I   SEE   IT   NOW!" 

— Reprinted  from  Literary  Digest. 


above   cartoon   fairly   presents   the   prevailing 

fs  of  the  country  upon  effective  remedies  for  the 

[trial  unrest,  as  well  as  the  acquiescence  of  the 

jess  world  in  those  views,  to  which  acquiescence  it 

)een  brought  by  the  pressure  of  popular  opinion 

(ts  own  ignorance  of  what  the  true  remedies  are. 

and  several  of  the  proposals  are  entirely  useless 

ledies,  and  the  application  to  practice  of  all  save 

that  of  Federal  Emplojmient  Bureaus,  not  only 

ft  help  the  condition,  but  make  it  worse;  and  are 

[direction  precisely  opposite  to  the  true  course, 

is  simply  individual  freedom. 


Issued  by 
[SINESS  MEN'S  ECONOMIC  ASSOCIATION 


WRITINGS  OF  JOHN  E.  BENNETT 

PAMPHLETS 

OUR    NATIONAL    TENDENCY    AND    ITS    GOAL 

Being  a  discussion  of  the  Political  and  Industrial  direction 
of  the  United  States  under  the  influence  of  prevailing  eco- 
nomic forces,  and  statement  of  the  causes  thereof,  and  the 
means  to  avert  the  conclusion  to  which  those  forces  are  pro- 
ceeding. 

Together  with  an  Address  before  the  Chinese 
Students'  Association  of  America  at  its  Con- 
vention held  in  San  Francisco  in  January,  1914, 

upon 

THE    STUDENT   IN    ORIENTAL    IMMIGRATION 

Considering  the  eflfect  upon  China  and  Japan  of  the  Policy 
of  the  United  States  in  shutting  off  migration  of  the  Orient 
with  the  West,  the  real  cause  that  moves  industrial  migration, 
and  the  condition  that  confronts  Oriental  Students  seeking 
education  in  the  United  States,  by  reason  of  these  influences. 
32  pp. 


"JAPAN'S   MESSAGE    TO   AMERICA  " 
(A  Reply) 
Considering   the   impelling    cause    which    moves    the   Japanese 
nation   to  desire  the   good   will   of  the  American   people;    the 
necessity   to   Japan    of   free   intercourse   with   the   civilization 
of    the    West,    now    shut    off    by    immigration    exclusion;    the 
calamity  which  inevitably  must  befall  that  nation  through  a 
continuance   of   the   isloatlon   thrust   upon   her   by   this   policy. 
The    doctrine    of    exclusion    shown    to    rest    upon    a    mistaken 
belief  regarding  the   effect  of  labor  immigration   upon   wages 
of  intra-country  workmen;  the  popular  opinion  being  that  such 
immigration  lowers  wages,   whereas,   in  truth,   it  raises  wages 
and  increases  general  prosperity. 
33  pp. 


THE  INDUSTRIAL  UNREST 
Noting  the  rise  and  forms  of  human  government.  The  move- 
ment for  expunging  the  Constitution  of  the  United  States, 
with  the  cause  and  processes  of  that  movement.  The  passing 
of  the  American  Commonwealth  and  the  evolution  of  the  cen- 
tralized State  in  its  stead;  with  observation  of  the  several 
forces  responsible  therefor.  Remarking  the  various  expedients 
for  relief  of  the  working  classes,  among  which,  the  California 
eight-hour  labor  initiatives,  and  sundry  others.  The  basic 
errors  of  such  proposals,  and  the  hopelessness  of  benefit  to  the 
working  people  through  pursuit  of  their  direction.  Together 
with  consideration  of  the  true  cause  of  prevailing  wrong  con- 
ditions within  the  nation,  and  the  disaster  in  which  these  must 
culminate  unless  they  be  intelligently  and  courageously  cor- 
rected. 

70  pp. 


THE  CALIFORNIA  MANUFACTURER  AND  EASTERN 
COMPETITION 
The  natural  evolntion  of  the  State  from  an  agricultural  into 
a  manufacturing  community  shown  to  be  held  in  abeyance  by 
artificial  wage  rates  and  conditions  imposed  upon  employers 
by  unions.  Helplessness  of  the  California  manufacturer  in  the 
field  of  competition  through  these  influences,  and  the  inevitable 
passing  of  the  important  manufacturing  industries  of  the  State 
unless  the  employer  shall  assert  control  of  his  establishment 
and  place  his  labor  on  a  basis  of  free  industry.  Artificially 
high  wages  shown  to  be  of  no  benefit  to  the  laborer  receiving 
them,  while  the  consequent  narrowing  of  the  industrial  field 
suppresses  business  and  produces  ever  increasing  numbers  of 
idle  workmen.  The  remedy  and  proper  line  of  operation  pre- 
sented, and  the  vast  oportunity  at  the  hands  of  the  manu- 
facturer in  supplyipLg  the  local  and  over-'4ea  trade,  considered. 
35  HI),  r  .    *  . 


Copies  of  the  -witlifn  pigiplUets,  or  booklets  may  be  had  by 

•  -   adHresstng      •        •  *• " 

BUSINESS  MEN'S  ECONOMIC  ASSOCIATION 

1310   Humboldt  Bank   Building 

San  Francisco,  Cal. 


z 
An  Erroneous  Viewpoint 

By  JOHN  E.  BENNETT. 


Near  the  outskirts  of  San  Francisco  there  is  a  barri- 
cade of  boards  behind  which  is  encamped  some  hundreds 
or  thousands  of  men  who  comprise  the  "out  of  work 
army."  They  are  being  fed  by  public  charity.  The 
Board  of  Supervisors  have  made  a  large  appropriation 
for  their  sustenance,  while  the  Mayor  has  issued  a  proc- 
lamation and  appointed  a  day  asking  all  citizens  there- 
upon to  donate  one  dollar,  toward  provisioning  these 
people.  Private  charity  last  winter,  and  in  the  years 
prior,  exhausted  itself  in  sustaining  these  same  persons, 
less  their  added  numbers  of  today,  and  it  is  manifest 
that  the  problem  has  passed  beyond  the  scope  of  private 
alms ;  the  State  in  its  political  subdivisions  rnust  come 
forward  and  use  public  funds  to  cope  with  a  condition 
which  none  understand ;  for  these  men  are  not  sick,  or 
criminal,  they  are  merely  occupationally  idle;  they  each 
and  all  s.iy  they  want  work ;  and  industrial  initiative, 
that  is,  citizen  initiative,  is  not  sufficient  to  bring  for- 
ward business  which  will  call  them  into  employment. 
Citizen  initiative,  or  in  other  words,  that  initiative  which 
arises  in  the  tield  of  the  free  scope  and  action  of  the 
individual,  this  failing  to  generate  industry  which  would 
give  them  jobs,  political  initiative  must  be  wheeled  into 
the  clearing  to  do  for  them  what  the  people  generally 
have  failed  to  do.  Hence  the  Supervisors  and  the  Mayor 
touch  heads  in  studying  out  plans  to  "make  work"  for 
these  workless.  Piles  are  moved  from  one  spot  and 
made  in  another;  holes  are  dug  and  filled.  There  are 
always  things  to  be  done  about  a  city ;  but  work  that  is 
placed  where  the  achievement  is  not  the  object  of  the 
effort,  but  the  purpose  is  merely  to  keep  one  stirring  to 
provide  a  pretext  for  giving  him  pay — that  order  of 
work  is  likely  to  be  wasteful. 

Yonder  in  France,  in  the  valley  of  the  Aisne,  there  is 
another  barricade;  this  is  not  of  boards,  but  of  earth, 
and  behind  it  there  are  also  some  thousands  of  men, 
likewise  out  of  work,  and  in  the  pay  of  the  State.  They 
are  living  in  burrows  in  the  earth  like  the  cave  men  at 
the  dawn  of  nature ;  and  what  they  are  doing  is  just  that 
thing  which  the  cave  men  did — they  are  trying  to  de- 
stroy all  men  within  their  reach  who  are  not  of  their 
particular  group  or  tribe.  Here,  then,  we  have  it  that 
these  men,  being  consumers  and  not  producers,  depend- 
ents of  the  State  and  in  its  service,  are  exerting  them- 
selves in  the  operations  of  destruction.  The  distance  of 
space  which  separates  the  two  encampments,  the  vari- 
ance in  nationalities  and  environment,  would  seem  to 
dissever  the  respective  assemblages  of  any  possible  rela- 
tion which  they  might  bear  as  common  members  of  the 
human  family.  But  in  the  region  of  thought  we  are 
pursuing,  space  and  nationality  are  without  significance. 
We  are  dealing  with  the  domain  of  economics,  and  in  its 

329^35 


coiiuiui  .  ii..,i  \.  <_  >..ai.  >tv  lijat  both  bodies  of  men 
are  the  offspring  of  the  same  force.  That  between  the 
industrial  men  who,  working  on  the  building  across  the 
way,  are  exerting  their  efforts  in  the  processes  of  con- 
struction, the  idle  multitude  encamped  in  sloth  and 
misery  who  have  ceased  to  be  constructive,  and  are 
merely  negligible  with  their  status  feathering  toward 
destruction  in  that  they  consume  and  do  not  produce,  to 
the  men  in  the  pits  who  have  ceased  construction  and 
passed  from  consumers  merely  to  the  active  agents  of 
destruction — that  between  and  connecting  all  and  each 
of  these  there  is  the  one  attribute,  they  severally  are 
segments  of  society,  and  their  status  respectively  is  of 
social  phenomena. 

As  the  highest  natural  law,  aside  from  that  of  man 
holding  himself  in  existence,  is  sennce,  and  as  service  is 
essentially  the  quality  which  makes  it  possible  for  men 
to  exist  in  society,  it  would  seem  that  any  influence 
which  specialized  and  tolled  off  a  large  number  of  the 
people,  whose  segregation  deeply  affected  the  whole  of 
society,  might  have  something  to  do  with  service;  and 
as  the  principal  and  real  service  of  man  is  that  through 
which  he  renders  benefit  and  not  harm  to  his  fellow, 
we  should  in  such  analysis  look  at  industry,  which 
embodies  most  of  the  service  of  man,  to  see  if  the 
phenomenon  we  have  noted  bears  any  relation  to'  this 
realm  of  human  activity.  Unquestionably  the  idle  men 
have  something  to  do  with  industry,  in  that  they  have 
been  thrust  out  of  industry;  but  the  relation  of  the 
men  in  the  trenches  to  industry  is  not  so  apparent; 
nevertheless  we  shall  see  that  they  are  quite  as  inti- 
mately a  part  of  the  industrial  question  as  the  men  on 
the  sand  lot,  or  the  men  at  work  on  the  building. 

And  when  we  consider  this  region  of  industry,  what 
concerning  it  today  do  we  note  as  its  most  striking 
quality?  Manifest^  it  is  its  rampant  state  of  inhar- 
mony;  it  is  not  working  in  its  coordinate  parts  smoothly 
and  to  achieving  its  results  in  the  natural  way,  that  is, 
attaining  its  ends  with  the  expenditure  of  least  effort. 
It  is  in  a  condition  of  stress,  in  a  state  of  tension ;  it  is 
overwrought,  full  of  jars ;  it  abounds  in  antagonisms,  in 
hatreds,  in  classism;  it  is  like  a  band  of  men  rushing 
on  under  a  leader  in  pursuit  of  quarry,  capturing  it, 
stopping  and  quarreling  over  its  distribution,  falling 
upon  and  destroying  each  other,  squeezing  out  and  driv- 
ing off  a  number  because  there  are  too  many  for  the 
portions  to  go  round,  then  gathering  together  and 
plunging  forward  again  upon  the  next  quest.  Manifestly 
such  a  mob  is  not  united  on  any  basis  of  natural  law. 
It  is  a  multitude,  large  enough,  indeed,  to  comprise  an 
army,  but  lacking  in  an  army's  organization.  By  virtue 
of  its  organization  an  army  moves,  strikes  and  has  its 
being;  instantly  it  becomes  disorganized  it  loses  its 
efficiency,  it  ceases  of  avail,  it  is  a  mere  aggregate  of 
helpless  units,  unstable  and  without  restraint,  howling, 
shrieking  and  rolling  on  to  destruction  or  dispersion. 
And  when  you  examine  an  army  you  find  it  built  in 
strict  accord  with  natural  law.  It  is  a  definite  multi- 
plication of  units  into  companies,  into  batallions,  into 
regiments,  into  brigades,  into  divisions,  into  corps.  The 
infantry  is  not  cavalry,  and  the  cavalry  is  not  artillery. 
There  is  the  engineering,  the  commissary,  the  sanitary, 
the  hospital  corps.  Ever>'  man  knows  his  place,  knows 
the  men  from  whom  he  takes  orders,  and  these  know 
and  understand   those   who  are   subject   to  them.     An 


order  given  by  the  head  flies  in  a  moment  through  all 
parts  and  brings  the  entire  aggregate  into  action.  The 
thing  is  schemed  to  effect  instant  coordination,  immedi- 
ate concentration  upon  a  single  aim.  You  can  draw  the 
entire  arrangement  symmetrically  upon  paper.  With 
compass  and  rule  you  can  create  the  establishment  by 
chart  so  that  all  you  have  later  to  do  is  to  fill  it  in 
with  men  and  munitions.  Can  anyone  chart  a  mob? 
And  yet  when  we  come  to  deal  with  this  great  matter 
of  industrialism,  to  analyze  the  structure  of  society,  and 
to  show  that  the  cause  of  the  industrial  unrest  is  that 
the  institution  does  not  square  with  natural  law,  to  show 
that  the  places  where  it  is  obviously  weak  are  where  the 
law  as  revealed  by  economic  reasoning  has  not  been 
regarded,  and  present  the  entire  edifice  as  with  lines  and 
figures,  we  hear  cries  of  "beautiful  theory,  but  it  won't 
'work  in  practice'!"  What  is  that  roll  which  your  archi- 
tect has  in  his  hand,  and  for  which  you  have  paid  five 
thousand  dollars?  A  plan?  throw  it  away,  it  is  nothing 
but  theory.  When  you  go  to  build  your  house  just  pile 
brick  on  brick  and  nail  wood  on  wood,  and  put  it  up 
according  to  your  notion  of  things,  or  a  clipping  out  of 
a  newspaper  and  it  will  stand  there  all  right,  and  it  will 
be  rentable  enough  ;  yes,  and  on  the  morning  of  the  first 
day  or  the  day  after  it  will  be  about  your  ears,  with  all 
the  howls  and  execrations  of  a  G)lorado,  a  West  Vir- 
ginia, a  Lawrence,  Massachusetts,  or  a  thousand  and  one 
spots  over  the  nation  where  such  houses  are  built.  Not 
alone  does  the  architect  figure  his  strains  and  scale  his 
measurements,  but  the  builder  places  piece  by  piece  upon 
the  structure  adjusted  with  plumb  bob.  tested  by  spirit 
level,  tried  by  square ;  and  when  it  is  finished  it  is  up- 
right;  it  is  horizontal;  it  is  symmetrical;  it  is  on  a  firm 
foundation ;  it  is  braced  and  trussed  and  supported ;  it 
has  been  built  according  to  plans  and  specifications 
created  and  elaborated  in  conformity  with  the  canons  of 
natural  law,  in  the  architect's  office. 

When  we  come,  however,  as  I  remark,  to  this  great 
construction,  the  organization  of  industrialism  which  is 
essentially  the  organization  of  society,  so  it  shall  com- 
prise an  edifice  that  will  stand,  or  a  machine  that  will 
run  smoothly  and  noiselessly  in  its  several  parts  to  the 
turning  out  of  its  results,  plans  are  not  wanted  and  are 
not_  used.  The  thing  bucks  and  kicks  and  flies  apart 
killing  and  wounding  its  operatives  with  its  fragments, 
and  yet  he  who  unrolls  a  plan  for  its  synchronous,  har- 
monious and  coordinate  action,  excites  few  onlookers. 
"These  things  adjust  themselves."  "We're  too  busy, 
don't  you  know ;  come  around  some  other  time." 

Meanwhile  public  opinion  educates  itself;  not  accord- 
ing to  natural  law.  but  with  an  arm  full  of  brick  and  its 
notion  of  things.  Government  Commissions  follow  each 
other  as  birds  spring  to  the  open,  flying  hither  and 
thither  to  find  out  what  the  matter  is.  They  call  to  ex- 
plain various  notable  men.  Mr.  Rockefeller.  Mr.  Car- 
negie, Mr.  Morgan,  and  the  rest.  "What  is  the  remedy 
for  the  industrial  unrest?"  Opinions  come  forth,  "thick 
as  blackberries."  Certain  of  them  are  so  oft  repeated 
that  they  are  accepted  by  the  public  as  true.  We  have 
a  summary  and  expression  of  these  in  the  cartoon  at  the 
head  of  this  article ;  and  as  these  have  a  wide  bearing 
throughout  the  nation  we  shall,  in  seriatim,  consider 
them  here. 

THE  TAX  ON  FORTUNES. 

It  is  certain  that  every  one  of  these  prescriptions  as  a 
remedy  for  the  industrial  unrest  is  utterly  empirical  and 


fallacious.  We  have  practically  all  of  them  in  operation 
now,  and  their  only  result  has  been  to  intensify  the 
condition  and  in  no  sense  to  relieve  it.  The  tax  on 
fortunes  we  have  in  the  jncome  tax  law,  the  confiscation 
reaching  as  high  as  seven  per  cent  of  the  total  income 
annually.  From  this  tax  there  is  for  the  corporations 
no  exemption.  We  have  it  also  in  the  super  death  dues, 
being  graduated  taxes  on  estates,  increasing  as  the  sum 
enlarges.  The  avowed  purpose  of  these  levies  is  not  to 
raise  revenue,  but  they  are  aimed  at  discouraging  the 
accumulation  of  wealth.  The  laws  are  enacted  upon  the 
hypothesis  that  society  is  injured  by  the  accretion  and 
existence  of  large  fortunes,  notwithstanding  that  those 
large  fortunes  are  all  invested  in  enterprises  giving  em- 
ployment to  commonwealths  of  men.  That  any  one  who 
during  a  lifetime  can  acquire  through  business  a  hun- 
dred or  five  hundred  million  dollars,  where  another  man 
working  in  his  shop  cannot  by  the  greatest  economies 
accumulate  ten  cents,  but  dies  in  debt — that  this  sort  of 
thing  is  outrageous,  and  must  be  done  away  with  by 
moving  against  the  millionaire  quite  like  we  put  out  of 
existence  the  old  state  banks,  viz. :  taxing  him  to  the 
limit  every  time  he  thrusts  his  hand  across  the  counter. 
No  legislation  could  be  more  foolish,  few  attempts  at 
legislation  cduld  be  more  harmful  to  the  ver>'  people 
whom  the  mistaken  legislaturemen  think  they  are  help- 
ing by  bringing  it  into  existence.  As  I  have  shown  in 
my  Tendency  and  I'nrest  pamphlets,  all  that  the  mil- 
lionaire can  get  out  of  society  is  what  he  eats  and  wears, 
and  his  shelter  and  transportation,  and  this  at  most  is 
little.  He  is  really  a  force  creating  wealth  through  his 
guidance,  bringing  into  existence  opportunities  for  other 
business  men,  making  jobs  for  laborers  which  would  not 
exist  but  for  his  eflForts,  The  wealth  he  is  acquiring 
simply  increases  his  powers  to  render  more  service  to 
society.  A  Rockefeller  in  possesion  of  a  hundred  mil- 
lions may  be  a  tremendous  power  for  the  creation  of 
new  industry  which  will  call  into  activity  hundreds  of 
thousands  of  men,  which  would  raise  other  thousands 
from  small  jobs  to  large  jobs,  from  places  where  they 
could  render  slight  service  to  positions  in  which  they 
could  render  large  service,  while  the  material  wealth 
he  would  force  into  existence,  the  oil,  the  iron,  the  rail- 
roads and  else,  would  enrich  millions.  An  altogether 
mistaken  view  exists  in  this  country  regarding  wealth 
and  men  of  wealth.  It  is  not  hurtful  but  highly  to  the 
advantage  of  the  people  generally  that  great  wealth 
should  exist  in  individual  hands.  So  long  as  monopoly  is 
crushed,  so  that  great  wealth  cannot  be  made  a  force  to 
prevent  other  men  from  exercising  free  scope  in  their 
several  operations,  there  is  nothing  to  fear,  and  monopo- 
lies exist  solely  by  reason  of  law;  the  possession  of 
monev  alone  capnot  effect  monopoly.  To  men  of  great 
executive  abilities,  large  wealth  is  a  necessity  required 
to  make  their  powers  effective  for  good,  without  the  use 
of  which  society  could  not  benefit  by  their  exertions,  for 
the/  would  there  be  no  more  useful  than  anyone  else. 

Where  then  is  the  sense  in  curbing  the  exertions  of 
men  of  genius  by  curtailing  through  law  their  possession 
of  that  thing  which  in  their  hands  is  their  effective  tool 
and  implement,  namely  wealth  ?  I  have  a  business  and 
hire  ten  men.  From  the  services  of  each  of  these  men 
I  tnake  a  daily  profit  of  ten  cents,  from  the  entire  one 
dollar.  W^ould  anyone  say  that  I  was  robbing  these  men 
of  the  products  of  their  hard-earned  toil  when  my  opera- 
tions,   consisting    of    administering    the    establishment 


which  employs  them,  results,  after  payment  of  rent,  in- 
terest, material,  and  overhead,  a  return  to  myself  of  ten 
cents  per  man?  Now  let  me  enlarge  that  establishment 
until  I  build  great  works,  transform  enormous  quantities 
of  materials,  conduct  vast  shipping,  distribute  products 
throughout  the  nation  and  over  the  world  and  I  still 
profit  ten  cents  per  man  per  day;  but  instead  of  employ- 
ing ten  men,  I  have  through  my  genius  and  application 
magnified  my  establishment  to  employ  a  million  men  a 
day  and,  lo !  my  income  every  day  is  a  hundred  thousand 
dollars  ;  in  a  year  thirty-six  million  dollars ;  in  ten  years 
three  hundred  and  sixty  million  dollars,  and  in  twenty 
years  seven  hundred  and  twenty  millions  of  dollars! 
When  straightway  I  am  denounced  as  a  robber  who  has 
oppressed  my  laborers,  which  laborers  have  not  gotten 
their  share  of  the  product  which  they  have  made  in  my 
shops,  wherefor  I  am  so  rich  and  they  are  so  poor,  and 
this  disparity  of  fortunes  in- society  is  not  healthy  for  the 
common  weal  and  cannot  be  permitted.  Then  come 
forth  schemes  to  curtail  my  activities,  to  prevent  repeti- 
tion by  others  of  such  things  as  I  have  done ;  in  other 
words,  to  kill  and  destroy  private  initiative  which  when 
lessened  there  follows  the  out-of-work  mass  whom  to 
employ,  initiative  by  the  State  must  be  invoked.  It  be- 
comes the  policy  of  the  State  to  approve  my  energies  so 
long  as  I  displayed  little  capacity  and  held  my  works 
to  a  ten-man  basis ;  but  when,  by  the  illumination  of  the 
mind,  and  by  abounding  energy  I  had  magnified  and 
glorified  the  industry,  brought  into  the  world  prodigious 
wealth  which  I  had  dispensed  to  the  comfort  and  happi- 
ness of  many  millions,  when  I  had  become  an  engine 
for  the  lifting  of  civilization  to  a  higher  plane,  and  was 
making  my  influence  felt  for  good  the  world  around, 
then  and  thereupon  instead  of  praise  and  distinction 
among  my  fellows,  I  am  become  a  scape-goat,  my  good 
deeds  are  derrogated  and  I  am  maligned  by  a  perverted 
public  opinion  as  a  menace  to  society !  What  can  be  the 
doom  of  any  nation  where  such  doctrines  are  accepted 
as  standards  and  guides!  When  it  becomes  a  public 
policy  to  suppress  the  bright  and  individual  lights  to  the 
lull  blur  of  mediocrity! 

\or  is  the  foregoing  sentiment  confined  to  denouncing 
me.  It  extends  also  to  my  benefices.  What  shall  I  do 
with  this  seven  hundred  and  twenty  millions  which  in 
these  twenty  years  I  have  accumulated,  together  with 
all  the  money  I  have  made  by  side  investments?  It  is 
more,  far  more,  than  it  would  be  wise  for  me  to  leave 
to  my  children  and  to  my  collateral  kin.  What  more 
natural  thing  is  there  for  me  to  do  with  it  than  to  use  it, 
guided  by  my  wisdom,  to  help  forward  the  scale  of 
being  of  my  fellow  man.  The  endowment,  the  founda- 
tion, is  just  as  natural  a  creation  of  the  industrial  genius 
as  the  shell  is  to  the  snail,  as  is  the  shop  which  he  builds 
to  cover  his  machinery.  He  can  no  more  resist  the  im- 
pulse to  devote  his  wealth  to  the  ends  of  human  uplift, 
unless  he  be  therefrom  discouraged  by  some  order  of 
public  disapproval,  than  he  can  resist  the  impulse  to 
walk.  The  fact  that  he  may  be  in  truth  the  most  selfish 
of  human  beings,  does  not  relieve  him  from  this  natural 
thrust.  Where  would  you  have  found  a  more  self- 
centered  man  that  Russell  Sage?  In  him  the  sense  of 
money-getting  had  become  so  acute  that  he  denied  him- 
self appropriate  clothing  in  order  that  there  might  be 
more  to  place  on  interest.  His  wealth  at  his  death  was, 
perhaps,  a  hundred  millions.  What  became  of  it?  To 
what  selfish  use  could  it  be  applied?     Building  a  marble 


shaft  a  thousand  feet  high?  Not  so.  The  practical 
mind  that  can  accumulate  a  hundred  millions  cannot 
contemplate  the  derision  which  on  part  of  its  fellows 
would  follow  such  absurdity.  He  turned  his  millions  to 
human  good;  and  what 'was  his  reward?  What  is  the 
right  and  due  to  which  he  has  thereby  become  entitled? 
It  is  the  gratitude  and  good  will  of  his  fellows.  "It  was 
damned  white  of  Andy !"  This  is  the  epitaph  which  Mr. 
Carnegie  wishes  may  be  carved  upon  his  tomb  by  the 
grateful  hands  whom  his  wealth  has  lifted  to  higher 
life,  and  is  there  a  human  being  who  carries  a  heart 
that  would  deny  it  to  him?  Under  the  impulse  of  a 
sense  of  public  gratitude,  and  that  natural  feeling  which 
exists  in  the  breast  that  "it  is  better  to  give  than  to 
receive,"  public  benefactions  of  the  wealthy  have  year 
by  year  gone  on  in  the  United  States  to  enormous 
totals;  in  1913,  for  instance,  they  reached  $302,000,000 
and  each  and  all  sums  were  devoted  to  ends  highly 
worthy  and  necessary,  the  gifts  comprising  hundreds  of 
donors.  And  yet  we  have  the  government  of  the  United 
States,  as  expressed  through  its  agent,  Mr,  Frank  P. 
Walsh,  Chairman  of  the  Industrial  Relations  Commis- 
sion, saying  in  a  speech  before  a  large  number  of  people, 
this: 

"Is  there  any  person  who  will  not  challenge  a 
$100,000,000  foundation ;  exempt  from  taxation  and 
to  be  used  in  a  way  that  the  people  do  not  dominate? 
There  are  no  limitations  on  those  funds.  Suppose 
all  these  foundations  should  concentrate  their  re- 
sources in  the  securities  of  one  industry  where  the 
toilers  were  making  a  fight  for  democratic  control. 
They  would  crush  down  the  defences  of  the  fight 
for  industrial  justice." 

The  idea  is  that  foundations  ought  to  be  prohibited  by 
law  because  they  might  upon  occasion  consolidate  their 
funds  and  break  a  strike !  And  this  from  the  head  of  a 
United  States  Commission  installed  and  set  in  motion  to 
investigate  in  behalf  of  the  whole  nation  the  relation 
of  industry  to  the  commonweal.  Where  is  there  a  dis- 
ciple of  the  perverted  doctrines  of  labor  unionism  who 
could  have  said  more  or  worse?  What  Darrow,  what 
McNamara,  what  Gompers  is  there  who  could  discharge 
at  a  great  philanthropic  endeavor  expressions  more 
sounding  in  scorn.  Of  all  the  great  of  American  busi- 
ness, who  have  made  these  United  States  so  mar- 
velous, so  prodigal  an  expression  of  industrial  achieve- 
ment, there  is  none  whose  feats  have  been  vaster, 
more  lustrous  or  far-reaching  than  those  of  John  D. 
Rockefeller.  That  he  should  have  taken  advantage  of 
monopoletic  conditions  in  his  business  career  to  further 
his  operations,  is  in  no  sense  a  reproach  upon  him,  but  it 
is  upon  us.  No  man  who  has  ever  operated  largely  in 
business  has  done  or  could  do  otherwise  under  the  ad- 
justments of  the  times.  Men  in  business  are  forced  to 
employ  all  the  avenues  in  the  business  field  to  shape 
ends  to  their  advantage ;  if  they  do  not  their  competitors 
will  do  so  and  drive  them  from  the  business  contest. 
Men  will  utilize  the  advantages  of  monopoly  in  business 
to  circumvent  a  rival,  and  in  their  capacities  as  citizens 
will  at  the  same  time  work  in  a  public  way  for  the 
abolition  of  the  very  monopolies  through  which  they 
have  benefited.  Public  opinion,  its  law  makers  and 
courts  define  the  scope  of  the  field  of  business,  and  no 
business  man  should  be  blamed  for  doing  at  any  time 


for  his  own  behoof  anything  that  is  lawful.*  To  depre- 
cate the  great  gift  which  Mr.  Rockefeller  has  bestowed 
upon  the  people  of  the  nation  in  the  magnificent  institu- 
tions of  practical  science  and  learning  he  has  established 
is  a  public  shame  and  disgrace,  and  comes  poorly  enough 
from  the  lips  of  one  who  is  drawing  public  money  upon 
the  hypothesis  that  he  is  conferring  a  public  benefit. 
There  is  nothing  more  significant  of  the  general  disrup- 
tion of  social  order  into  which  such  doctrinaires  as  Mr. 
Walsh  is  thrusting  us,  than  the  tolerance  of  the  public 
to  these  attempts  to  popularize  disapproval  of  men 
donating   their    wealth    for    human    enlightenment   and 

*  Let  me  illustrate:  The  Standard  Oil  Company,  a  large  pro- 
portion of  whose  stock  is  reputed  to  be  owned  by  Mr.  Rocke- 
feller, is  a  manufacturer  of  gasoline,  which  product,  it  is  stated, 
it  has  been  selling  in  the  California  market  at  eight  cents  per 
gallon.  This  is  said  to  be  the  lowest  figure  at  which  it  is  pos- 
sible for  a  small  refinery  to  manufacture  it,  and  if  such  are  to 
continue  their  output  of  gasoline  they  must  do  so  without  profit. 
If  these  statements  be  true  it  would  appear  that  the  Standard 
Oil  is  selling  its  product  at  the  highest  price  that  would  give  it 
the  entire  market  of  the  commodity,  assuming  'that  all  parties 
paid  a  similar  price  for  their  crude  oil,  which  is  probably  the 
fact.  Its  competitors  say  the  Standard  can  sell  at  eight  cents 
and  still  make  a  profit  by  reason  of  its  larger  capital  employed 
and  its  greater  and  more  highly  wrought  facilities  for  manufac- 
turing and  marketing,  and  that  the  purpose  in  so  selling  is  to 
force  its  competitors  out  of  business,  either  compelling  them  to 
quit  at  a  loss  or  to  sell  their  plants  to  it;  after  which,  being 
then  in  absolute  possession  of  the  market,  it  will  raise  the  price 
of  gasoline. 

If  the  Standard,  through  the  use  of  large  capital,  or  superior 
management  or  facilities,  is  actually  producing  gasoline  at  less 
cost  than  its  competitors,  it  has  certainly  a  right  to  this  benefit; 
and  no  complaint  can  be  made  at  it  turnishing  the  public  with 
the  product  at  the  very  lowest  cost.  Anyone  can  get  all  the 
capital  he  wants  if  he  be  able  to  show  good  security  therefor 
and  reasonable  certainty  of  interest  jrields.  There  is.  hence,  no 
monopoly  in  that  direction.  And  in  respect  of  facility  and 
management  there  is  no  monopoly  in  this;  the  field  is  free,  and 
any  one  may  employ  in  his  business  all  the  appliances  and  abili- 
ties he  can  bring  forth.  This  is  a  legitimate  zone  for  contest. 
Nor  is  it  to  be  allowed  that  should  the  Standard  eliminate  from 
the  field  its  competitors  through  underselling  them  that  they, 
realizing  that  upon  their  withdrawal  the  price  of  gasoline  would 
at  once  go  up,  would  thereupon  dismantle  and  junlc  their  plants. 
They  would  cease  gasoline  production,  carrying  on  or  not  the 
other  processes  of  oil  distillaton  as  the  same  may  or  may  not  be 
profitable,  and  wait  the  predicted  rise  in  the  price  of  gasoline, 
when  they  would  again  start  up.  So  the  assertion  of  the  merg- 
ing or  elimination  idea  as  being  at  the  bottom  of  the  Standard  s 
action  in  holding  down  the  market  price  of  gasoline  must  be 
deemed  erroneous.  The  reason  is  to  be  looked  for  elsewhere. 
And  it  is,  perhaps,  found  in  the  disclosures  just  made  in  the 
Washingtori  press  dispatches  that  the  Standard  owns  a  patented 
process  which  enables  it  to  produce  from  a  given  quantity  of  oil 
three  times  the  amount  of  gasoline  that  can  be  otherwise  ob- 
tained. Here,  then,  if  this  be  true,  we  have  it:  The  Standard 
has  a  monopoly;  a  monopoly  of  the  gasoline  industry  resting 
upon  the  monopoly  of  a  patent.  Its  industrial  monopoly  abides 
not  through  "capital,"  size  of  plant  or  "big  business,  but  upon 
law.  Can  anyone  blame  the  Standard  for  taking  advantage  of  a 
law  that  gives  it  a  monopoly  in  its  business?  If  it  were  not 
manufacturing  under  the  patent,  is  it  not  likely  that  some  other 
refinery  would  be  doing  so?  The  Standard  did  not  make  the 
law.  and  it  does  not  control  the  law's  existence.  Our  ancestors 
made  it  and  we  control  it.  Let  us  then  have  done  with  reviling 
the  Standard  and  abusing  Mr.  Rockefeller,  and  turn  our  thoughts 
to  so  adjusting  the  law  that  monopolies  of  this  order  may  not  be 
possible.  I  have  pointed  out  in  my  Industrial  Unrest  the  remedy 
for  this  condition.  It  is  simply  permitting  the  inventor  to  fix  a 
royalty  upon  his  invention,  the  government,  which  grants  the 
patent,  collecting  and  paying  him  the  sums  received,  the  inven- 
tion itself,  being  open  upon  equal  terms  to  all  desiring  to  use 
it.  This  would  end  this  order  of  monopoly  and  allow  free  play 
to  those  qualities  in  business  from  which  one  has  a  right  to 
benefit,  and  the  furtherance  of  which  should  be  encouraged. 
Such  a  provision  could  readily  be  safeguarded  to  make  it  effective 
so  the  inventor  would  be  powerless  to  prefer  one  user  as  against 
another. 


uplift  in  fields  in  which   it   is  not  proper   for  the  gov- 
ernment to  operate, 

PROFIT-SHARING. 

I  have  discussed  proftt-sharing  in  my-  Industrial  Un- 
rest. It  is  believed  by  many  to  be  the  true  solution  of 
the  labor  question.  If  laborers  own  an  interest  in  the 
business  why  would  they  not  have  a  care  for  the  welfare 
of  the  business,  and  so  caring  they  would  work  on  in- 
creasing their  eflFective  output,  and  not  strike  or  destroy 
the  property  of  the  plant,  for  this  would  decrease  their 
profits,  and  proportionately  destroy  their  prooerty.  I 
have  never  heard  of  any  one  objecting  to  a  laborer  be- 
coming an  owner  in  the  property.  The  stocks  of  all 
corporations  are  usually  purchasable  on  the  public 
market,  and  the  laborer,  as  anyone  else,  is  privileged  to 
buy.  Indeed,  so  desirous  are  many  corporations  of 
having  their  employees  become  interested  with  them  in 
the  business  that  they  make  special  inducements,  under- 
market  prices,  installment  payments,  etc.,  to  move  their 
employees  to  "become  stockholders.  The  union  does  not 
like  thi.s  sort  of  thing,  as  it  tends  to  transfer  allegiance 
of  the  laborer  from  the  union  to  the  company,  and  we 
hear  all  sorts  of  hard  things  said  about  the  *'robl)er 
capitalists"  who  coin  the  sweat  of  their  men  into  dol- 
lars and  use  them  to  conduct  their  business  with.  But 
this  is  not  the  order  of  profit-sharing  to  which  the  ad- 
vocates of  that  principle  refer.  They  propose  that  with- 
out purchase  of  stock  or  interest,  without  investment, 
merely  by  right  of  the  laborer  working  and  receiving 
wages  in  the  concern,  he  should  be  paid  in  addition  to 
his  wages,  a  proportion  of  the  profits  of  the  enterprise — 
that  is,  if  there  are  profits.  Already  he  has  received  as 
wages  the  full  measure  of  the  sum  for  which  by  his 
agreement  he  worked,  and  which  on  his  behalf,  his 
union  exacts.  He  has  hence  been  hiVy  paid.  But  if 
there  shall  be  profits,  it  is  assumed  that  they  arise  in  part 
through  his  industry  and  he  shall  be  further  paid,  while 
if  there  be  no  profits,  though  equal  amount  of  energy 
be  by  him  expended  as  when  he  received  profits,  then 
he  is^  not  entitled  to  further  pay.  In  other  words,  his  $3 
or  $5  per  day  \\4iich  he  receives  as  wages,  is  predicated 
upon  the  industry  breaking  even.  So  that  on  this  basis 
the  industry  rs  run  specially  to  give  him  employment. 
It  is  not  supposed  that  the  proprietors  shall  benefit  from 
the  business  from  this  standpoint.  In  fact  they  may 
lose,  for  his  wages  must  be  paid  withal.  But  if  the 
contingency  occurs  that  a  profit  ensues,  then  this  in- 
cident befalls  him  a  benefit,  for  such  profit  belongs  not 
to  the  proprietors,  but  in  part  to  him.  This  is  what  is 
now  contended  for  by  the  unions  and  their  advocates 
under  the  name  of  "industrial  democracy*' ;  it,  of  course, 
follows  with  this  arrangement,  that  the  laborer,  being 
ovmer  of  an  interest  in  the  business,  cannot  be  dis- 
charged therefrom ;  an  attempt  by  the  proprietor  to  dis- 
charge him  becomes  *'a  business  matter  between  business 
men,"  as  Secretary  of  Labor  Wilson  puts  it,  and  says 
that  his  branch  of  the  Federal  Government  is  in  ex- 
istence to  see.  on  behalf  of  the  laborer,  that  is  to  say, 
the  union,  to  just  that  thing.  I  have  discussed  the  up- 
shot of  this  scheme  in  The  End  of  Business,  to  which 
the  reader  is  referred.  It  must  be  apparent  that  under 
profit  sharing  the  laborer  receives  something  to  which 
he  is  not  entitled,  something  that  he  does  not  earn. 
Of  course,  if  the  laborer  has  received  as  his  wages  a 
so-called  minimum,  as  where  full  wages  are  $5  and  he 

8 


receives  but  $3,  trusting  to  recover  the  other  $2  with 
added  returns  in  a  profit-sharing  device,  then  it  is  alto- 
gether different.  He  is  then  an  investor  in  the  business 
to  the  extent  of  $2  per  day,  and  is  entitled  to  just  such 
consideration  of  returns  or  losses  as  $2  per  day  from  an 
outsider  would  buy.  But  the  profit-sharing  idea  does 
not  contemplate  this.  It  presupposes,  as  I  have  said, 
paying  the  man  wages  as  wages;  that  is,  full  wages; 
then,  in  the  event  of  dividends,  to  give  him  a  share  of 
these  as  a  sop  to  stir  him  to  do  to  the  employer  the  duty 
which  he  was  paid  by  his  wages  to  perform. 

It  is  an  essential  quality  of  profit-sharing  that  it  acts 
horizontally,  without  regard  to  the  effort  put  forth;  the 
employee  receives  his  share  of  the  profits,  not  because 
through  extraordinary  effort  he  earns  an  addition  to- 
his  wages,  but  because  he  is  an  employee.  The  moment 
the  profit-sharing  plan  drops  its  horizontal  aspect  and 
differentiates,  basing  its  reward  upon  service,  it  becomes 
a  bonus  system,  and  not  a  profit-sharing  system  at  all; 
for  the  bonus  system  is  based  upon  paying  a  man  accord- 
ing to  his  merit,  the  method  of  all  most  detested  by  the 
unions.  There  is  no  doubt,  however,  that  this  is  the 
ultimate  form  which  labor  conditions  will  take.  It 
contemplates  a  standard  of  output  for  a  day's  work  and 
encourages  with  rewards  care,  skill  and  unusual  en- 
deavor. Rewards  of  merit  are  a  common  feature  of  all 
institutions  or  places  where  assemblages  of  either  sex 
work  upon  an  organized  basis,  and  they  are  not  alone 
fitting  but  necessary  to  bring  forward  the  best  efforts 
and  permeate  the  shop  with  a  healthy  tone. 

The  effect  of  profit-sharing  is  to  carry  wages  over 
into  the  domain  of  profit,  and  whatever  narrows  the 
proHt  of  the  proprietor  destroys  incentive,  gives  him  less 
disposition  to  extend  business,  or  even  to  carry  it  on, 
disposes  him  to  look  ahead  and  around  for  easy  jump- 
ing-off  places  where  he  can  land  on  the  upholstery  of 
some  club  or  else  quit  the  bother  with  business  which 
has  become  too  unattractive  to  be  longer  worth  the 
candle,  and  giving  himself  up  to  inactivity  and  a 
selfish  life.  There  are  in  the  United  States  today 
thousands  and  thousands  of  men  who  have  ceased  busi- 
ness upon  moderate  competencies  and  withdrawn  their 
energies  from  the  befiefit  of  society  through  this  influ- 
ence, and  profit-sharing  is  a  scheme  which  accelerates 
and  does  not  retard  this  disposition. 

Profit  in  business  is  simply  incentive.  It  is  the  "taste 
of  blood,"  as  the  slang  has  it,  which  edges  the  appetite 
of  a  man  to  plunge  into  busines  with  fierce  energy  and 
make  a  fortune ;  and  when  the  lure  of  fortune  disappears 
from  the  realm  of  business,  be  sure  that  business,  as  we 
have  known  it  in  the  past,  will  in  like  manner  disappear. 
Of  course  O'Toole  at  the  corner  will  still  sell  crackers, 
and  Heintz  at  the  door  beyond  will  decant  his  flagons  of 
heavy-wet — these  men  are  not  in  business  to  make  for- 
tunes; their  capacities  are  adjusted  to  simple  livings; 
business  of  that  order  and  a  little  better  will  go  on ;  but 
the  men  who  level  forests,  who  build  steel  works,  who 
slide  great  ships  smoothly  and  swiftly  down  the  ways, 
and  those  who  send  them  far  and  yon  upon  the  seven 
seas — these  men  will  be  no  more ;  the  government  will 
be  doing  such  things  with  initiative  supplied  and  put  in 
place  by  the  politicians. 

FEDERAL    EMPLOYMENT    BUREAU. 

There  is  no  objection  and  much  to  commend  extend- 
ing  the   facilities   of    finding   employment   to     laborers. 


through  the  offices  of  the  postal  department.  That  this 
is  a  proper  function  of  government  I  have  explained  in 
the  Manufacturer's  pamphlet.  It  would  by  no  means 
solve  industrial  unrest, ,  which  moves  altogether  from 
another  cause;  but  it  would  greatly  aid  in  distributing 
labor,  idle  in  one  spot  to  places  where  it  may  be  needed. 
Seasonal  employment  has  always  existed  in  the  United 
States.  When  certain  industries  close  for  the  winter 
the  men  drift  to  the  cities  and  are  idle  until  spring;  this 
has  ever  been  the  occasion  of  annoyance  and  sometimes 
stress.  In  the  Manufacturer's  pamphlet  and  The  End  of 
Busitiess  I  show  how,  under  normal  conditions,  this 
state  of  things  would  not  occur  to  the  inconvenience  of 
laborers. 

HIGHER  WAGES. 

In  this  clause  of  the  list  lies  the  whole  cause  of  the 
industrial  disturbance.  I  have  gone  into  it  extensively 
in  my  prior  writings  and  will  only  touch  upon  it  here. 
A  man  comes  to  my  shop  for  work.  'What  are  you 
paying?"  he  asks.  "Two  dollars,"  say  I,  "far  a  nine- 
hour  day."  "That  is  not  enough,"  he  replies;  "I  am 
offered  by  Brown  two  and  a  quarter  for  an  eight-hour 
day."  "Very  well,"  say  I,  "that  is  all  we  are  paying 
here,"  and  he  goes  to  Brown.  But  more  business  comes 
into  the  shop  and  I  need  men.  I  can't  get  them  unless  I 
pay  $2.25  for  eight  hours,  because  business  is  brisk  and 
men  are  needed  everywhere.  This,  says  the  union,  is 
the  law  of  supply  and  demand.  That  supply  and  de- 
mand, in  the  sense  in  which  it  is  commonly  understood 
in  the  field  of  commodities,  does  not  apply  in  the  realm 
of  service  I  have  shown  in  Our  National  Tendency  and 
Its  Goal.  But  I  have  also  shown  that  there  is  such  a 
thing  as  a  natural  and  an  artificial  supply  and  demand; 
the  natural  condition  is  that  I  have  described,  where 
men  are  scarce  through  prevalence  of  business  activities ; 
the  artificial  is  where  the  union  keeps  men,  otherwise 
idle,  away  from  the  shop  until  the  high  wage  rate  de- 
manded is  paid.  In  the  first  case  the  wage  requirement 
is  normal  and  proper  and  does  no  harm  to  industry;  in 
the  second  case  it  is  wrong  and  injurious  and  tends  to 
destroy  industry.  It  is  this  slipping  of  the  cog  from 
normal  to  abnormal  wages  that  has  caused  the  indus- 
trial unrest. 

The  remedy  is  not  by  allowing  higlier  wages,  but  by 
readjusting  wages  to  the  natural  line.  If  industry  is 
to  survive  in  the  United  States  without  passing  the 
nation  through  the  evolution  which  now  threatens, 
namely  the  centralized  State  or  Socialism,  a  terrible 
war  of  the  character  raging  in  Europe,  followed  by  a 
breaking  away  again  from  the  centralized  form  and  a 
moving  once  more  in  the  direction  of  individual  liberty 
— if  this  is  not  to  be  the  process,  then  wages  must  be 
placed  on  the  normal  basis,  and  natural  law  must 
again  prevail  in  the  industrial  world.  Existing  wages 
are  the  result  of  successive  raises  which  have  been  forced 
upon  the  employer  by  the  union,  without  regard  to  the 
price  of  the  product  as  determined  by  a  competing 
market,  to  pay  the  wages.  The  policy  of  the  union  has 
been  to  get  higher  and  again  higher  wages,  less  and  ever 
less  hours,  and  shop  conditions  under  which  the  laborer 
was  privileged  to  turn  out  as  little  product  as  possible, 
because  the  more  he  produced,  the  less,  it  was  assumed, 
"labor"  would  have  to  do.  This  operation  has  enor- 
mously increased  cost  of  the  product  and  lessened  the 
area  of  its  profitable  shipment  from  the  site  of  its  pro- 
duction, and  has  not  benefited  the  laborer,  for  it  has 

10 


raised  the  cost  of  living  always  in  excess  of  the  relative 
raise  in  wages.  What  is  transpiring  now  is  a  rapid 
contraction  of  this  zone  of  profitable  shipment,  a  pro- 
cess that  is  going  on  so  fast  that  the  contrary  force  of 
cheapening  cost  through  invention  and  improved  sys- 
tems has  not  been  able  to  keep  up  with  it,  but  has  been 
wholly  overcome  and  set  to  naught  by  this  strongly  cen- 
tralizing power  of  the  artificially  raising  wage.  It  will 
not  be  long  before  goods  will  be  produced  at  too  high  a 
cost  to  ship  very  far  from  the  factory.  Clothing  made 
in  San  Francisco  at  high  cost,  may  find  a  limited  market 
in  the  immediate  vicinity  of  its  production ;  but  when 
the  charges  of  packing,  shipment  and  incidental  costs 
are  added  to  get  it  over  in  Nevada,  it  becomes  too  ex- 
pensive to  be  purchased  by  the  would-be  Nevada  con- 
sumer. Such  clothing  is  limited  to  the  luxuries  of  the 
rich,  and  the  market  is  narrowed  accordingly.  The 
effect  of  this  is  thrown  back  upon  the  San  Francisco 
factory;  its  market  being  curtailed,  it  must  turn  off 
hands,  and  so  the  idle  army  is  formed  and  increased. 

Artificially  high  wages,  therefore,  that  is,  wages  which 
can  only  be  paid  through  increasing  the  price  of  the 
product,  decrease  consumption  of  the  product,  lessen  the 
numbers  of  the  laborers  engaged  in  the  industry  and 
throw  men  out  of  work.  As  this  action  goes  on  the  idle 
industrialists  continue  to  increase,  and  corresponding 
stress  prevails  throughout  the  nation.  I  have  noted  in 
my  Manufacturer's  pamphlet  the  condition  of  England 
just  prior  to  the  war,  with  its  million  of  registered  pau- 
pers in  a  population  of  forty-six  millions,  with  its  vast 
system  of  work  houses  and  its  elal>orate  poor  laws  and 
out  of  work  provisions,  with  its  unionized  industry  con- 
solidating into  a  single  body  and  shaping  itself  for  a 
mass  strike  to  have  been  held  in  1915,  with  the  business 
men  on  the  other  hand  raising  two  hundred  and  fifty 
millions  of  dollars  to  resist  its  attacks.  Manifestly  this 
strain,  which  obtained  with  equal  intenseness  in  every 
country  of  Europe,  could  not  continue  long,  for  the 
dry  rot  of  the  unemployed,  which  is  decadence,  was  eat- 
ing into  the  heart  of  the  nations,  especially  of  England 
and  France,  which  countries  were  less  given  to  govern- 
ment initiative  than  was  Germany.  There  followed,  ac- 
cordingly, war.  War  always  comes  to  save  civilization. 
If  there  is  one  fact  readily  to  be  recognized  it  is  that 
from  the  beginning  the  Divine  command  upon  man  has 
been  progress;  this  has  been  attained  by  driving  forward 
the  race  at  the  sacrifice  of  the  individual.  Onlv  in  this 
way  could  man  have  progressed,  and  his  career  has  been 
successive  progression  from  the  ape  to  the  present  day. 
In  driving  him  on  it  was  necessary  to  hold  down  his 
numbers,  or  the  earth  would  have  become  over  popu- 
lated with,  inferior  beings,  for  the  tendency  of  population 
is  to  outrun  development  of  the  mind.  Severe  checks 
unon  population,  therefore,  have  to  be  by  nature  ad- 
ministered upon  the  race  wherever  conditions  within  it 
arise  which  arrests  its  development  and  halts  its  pro- 
gression. This  is  the  meaning  and  purpose  of  war. 
The  phenomenon  is  presented  and  worked  out  in  my 
War  and  Business.  War,  therefore,  necessarily  follows 
the  state  of  things  which  the  labor  union  with  its  arti- 
ficial wage  is  rapidly  bringing  upon  the  country.  Under 
such  conditions  it  becomes  necessary  that  large  numbers 
be  killed  off  and  their  property  destroyed,  in  order  that 
people  shall  be  given  something  to  do  in  building  it  up 
again  when  the  war  is  over,  at  which  time  there  shall 
not  be  left  more  people  than  there  are  jobs.     In  other 

11 


words,  population,  which  has  run  ahead  of  the  unfold- 
ment  of  mind,  is  killed  back  to  a  number  to  accord 
with  the  status  of  the  mind's  development.  The  proces- 
of  reproducing  the  destroyed  structures  and  industries 
generates  a  national  activity  which  drives  civilization  a 
few  pegs  further  on  beyond  what  it  was  at  the  out- 
break of  the  war,  just  as  the  reproduced  San  Francisco 
is  a  better  built  city,  of  more  imposing  edifices  than  the 
one  which  was  destroyed.  This  is  the  law.  It  is  the 
operation  of  the  same  principle  in  that  region  of  Nature 
which  acts  in  human  affairs  as  that  which  moved  Mr. 
Powderly  while  head  of  the  Knights  of  Labor  to  advise 
his  followers  to  break  the  empty  bottles  that  the  bottle 
makers  might  have  work  in  making  new  ones ;  that 
causes  the  unemployed  carpenter  to  feel  glad  at  the  sight 
of  the  burning  building,  for  he  may  be  called  to  the 
work  of  constructing  a  new  one.  When  population 
thickens,  and  men  are  thrown  off  as  slough  from  the 
wheels  of  industry  through  wages  fixed  at  figures  where 
to  pay  them  the  prices  of  the  commodities  must  be 
raised,  so  that  consumption  is  greatly  lessened,  and  the 
number  of  men  in  industry  must  be  accordingly  les- 
sened, and  when  this  has  eaten  some  distance  into  the 
heart  of  the  nation,  war  ensues;  it  may  be  external  or 
internal  war;  it  may  be  a  matter  of  moment  that  shall 
start  it,  or  the  ignition  may  be  through  a  very  trifling 
incident ;  in  any  event  it  comes ;  large  numbers  of  people 
arc  destroyed,*  property  is  wrecked,  and  when  the  war 
is  over  the  nation  gathers  its  strength  and  builds  it:^ 
structures  up  again.  There  will  be  no  unemployed  in 
Europe  at  the  close  of  the  war;  there  will  be  work  for 
everyone ;  a  vast  reconstruction  period  shall  have  set  in 
upon  the  nations,  and  before  this  spell  is  broken  Euro- 
pean civilization  shall  have  gone  to  a  higher  station  than 
it  has  ever  yet  attained.  Here,  then,  we  see  the  magnetic 
cord  that  threads  together  the  thousands  on  the  sand 
lots  of  San  Francisco  with  the  thousands  in  the  trenches 
of  France. 

Upon  the  other  hand  if  industry  is  properly  adjusted, 
if  natural  law  be  regarded  in  the  economic  arrangement 
of  a  nation,  increase  in  number  of  population  does  not 
create  the  phenonrena  of  disturbance  we  have  noted. 
The  more  men  who  then  come  into  the  nation  the  better 
it  is  for  every  one,  as  the  higher  is  the  cooperative  effort 
and  the  greater  and  more  abundant  the  wealth,  which 
once  produced  finds  a  just  distribution  according  to  the 
individual  effort  contributed.  Adjust  industrial  society 
according  to  economic  law,  and  continental  United 
States  would  sustain  in  the  highest  luxury  the  entire 
human  race ;  whereas  under  existing  arrangements,  Cali- 
fornia, capable  of  sustaining  a  hundred  million,  is  over- 
crowded with  less  than  two  and  a  half  millions,  so  that 
there  are  thousands  of  men  on  the  lots  I  have  mentioned, 


•  Emigration  stands  as  a  counterpart  of  war  in  relieving 
populated  centres  of  congestion.  The  emigrant  in  his  new  field 
creates  produce  which  is  sent  back  to  his  native  land  in  the 
form  of  trade,  while  he  enriches  the  country  in  which  he  works. 
War  kills  the  worker,  and  by  destroying  construction  provides 
work  in  reconstructing  for  the  survivors,  many  of  whom  were 
unemployed  at  the  outbreak  of  the  war.  Where  emigration  does 
not  exist,  war  is  the  only  alternative  at  the  crisis  stage  of  the 
civilized  development,  under  the  system  of  economics  now  ob- 
taining in  all  countries,  that  is:  artficial  wage,  protective 
tariffs,  business  smothered  with  taxes  and  restrictions  and  land 
held  idle  for  speculation.  We  can  understand,  therefor,  the 
crime  of  those  who  operate  to  exclude  immigration  for  which 
there  is  an  industrial  demand  in  the  country,  otherwise  they 
would  not  come.  Such  mistakened  advocates  are  merely  piling 
up  the  people  in  their  home  areas,  many  of  whom  must  be  slain 
by  war. 

12 


and  sheltered  by  trees  and  vacant  buildings  up  and  down 
the  State,  men  for  whom  society  has  no  use.  With 
society  adjusted  under  economic  law.  civilization  rapidly 
rises,  and  as  it  ascends,  increase  of  population  declines, 
the  birth  rate  being  least  in  the  stratum  of  society  at 
the  summit  of  civilization.  The  graduates  of  the  uni- 
versities die  out  in  five  generations.  Great  fecundity 
obtains  on  the  lower  levels  of  civilization.  Feed 
ignorant  people  well  and  they  multiply  rapidly.  The 
large  families  are  among  the  peasantry,  not  among  the 
college  professors.  So  that  under  economic  law,  a  rising 
civilization  would  automatically  shut  off  its  increase  Ol 
population  so  that  tht  earth  would  never  become  over- 
populated ;  which  condition  would  otherwise  •  occur  to 
the  density  of  Belgium  within  three  centuries,  at  the 
existing  ratio  of  increase  of  the  population  of  southern 
Russia.  Proper  economic  adjustment,  at  the  bottom  of 
which  lies  the  wage  question,  would  therefore  secure 
continuous  peace,  and  abolish  war. 

Natural  wages,  or  wages  according  to  economic  law, 
is  the  chief  remedy  for  the  general  disturbed  condition 
of  the  industrial  and  social  world  we  have  been  noting. 
These  are  wages  fixed  at  a  sum  which  the  price  of  the 
product  does  not  have  to  be  raised  to  pay ;  which  allows 
the  employers  to  compete  in  and  hold,  not  only  the 
markets  of  his  own  State,  but  to  enter  adjoining  States 
and  also  to  enter  the  great  markets  of  the  world  and 
compete  there  with  foreign  manufacturers ;  wages  which, 
therefore,  will  enable  the  employer  to  extend  his  busi- 
ness, instead  of  forcing  him  as  at  present,  to  narrow  it; 
that  will  move  him  to  take  on  hands  and  draw  men 
from  the  idle  army,  instead  of  laying  off  hands  and 
increasing  it,  as  is  now  constantly  going  on.  I  shall 
hear  at  once  cries  of  "Oh,  we  can't  go  into  the  foreign 
market,  we  can't  compete  with  the  pauper  labor  of 
Europe;  do  you  want  us  to  reduce  our  living  conditions- 
to  the  condiiton  of  the  semi-serfs  of  Europe?"  To 
which  I  reply :  I  think  we  shall  travel  far  in  Europe  to 
find  wages  tixed  at  a  lower  rate  than  is  being  paid  to 
those  multitudes  of  men  in  their  cantonments  on  the 
.«and  lots ;  and  when  you  graduate  from  these  upward 
in  the  scale  of  wages,  comparing  those  of  the  United 
States  with  those  of  Europe,  you  find  them,  under  equal 
conditions,  just  about  the  same;  not  the  same  in  amount, 
liut  relatively  the  same  in  the  purchasing  power  of  the 
wage  when  received.  I  say  "relatively  the  same,"  for  what 
oppresses  the  European  laborer  is  not  his  low  wages, 
for  low  V  ages  are  normallv  attended  with  low  cost 
of  living.  The  laborer  in  the  United  States  would  live  bet- 
ter on  low  wages  than  he  now  lives  on  his  artificial  high 
wages ;  for  the  reason  that  under  low  wages  and  the 
call  into  cooperative  effort  of  multitudes  of  men  now 
kept  out  of  industry  by  the  effects  of  those  same  high 
wages,  and  kept  out  of  the  country  by  immigration  ex- 
clusion laws  mistakenly  laid  to  protect  those  same  high 
wages— with  these  changes,  I  say,  the  American  laborer 
would  live  at  slight  cost  by  reason  of  the  cheapness  and 
plenty  of  everything;  under  such  conditions,  with  offer- 
ings of  work  everywhere  about  him  and  times  good, 
wages  would  be  relatively  high  compared  with  the  really 
low  wage  he  receives  at  present,  though  he  is  paid  every 
pay-day  with  a  hat  full  of  coin.  What  holds  down  the 
European  worker  is  that  after  receiving  low  wages  he 
must  spend  it  in  a  high  market,  not  a  market  made  high, 
as  it  is  here  by  artificial  wage,  but  by  taxes  imposed  by 
government,  enormous  imposts  drawn  from  industry  to 

13 


sustain  armaments,  navies  and  unceasing  preparations 
for  war;  to  maintain  great  overlord  military  and  official 
castes  and  establishments,  whose  existence  are  not  a 
particle  of  benefit  to  the  people,  but  which  terribly  op- 
press them  and  eat  out  their  substance,  which  is  yielded 
up  upon  the  concept  that  the  man  of  the  countr>'  across 
the  creek  or  beyond  the  timber  is  their  natural  enemy, 
and  unless  they  get  ready  to  kill  him  he  will  come  on 
and  kill  them.  How  inexpressibly  false  and  foolish  all 
this  is,  leading  nowhere  but  to  ruin  of  millions,  I  have 
shown  in  War  and  Business,  and  that  it  exists  only  and 
solely  because  natural  law  is  not  followed  in  their  eco- 
nomic systems,  which  same  natural  law  I  am  trying  to 
show  the  United  States  in  order  that  we  may  be  spared 
like  calamity. 

In  the  field  of  foreign  trade,  the  trade  of  the  Orient 
and  of  South  America,  there  will  be  many  things  which 
we  cannot  produce  in  competition  with  Europe,  which 
therefore,  we  ought  not  produce,  and  many  things  which, 
by  reason  of  our  natural  resources,  our  climate,  our  skill 
and  mechanisms,  our  geographical  position  and  propin- 
quity to  the  markets,  we  can  produce,  and  have  here  in 
San  Francisco,  and  at  every  port  on  this  Coast,  a  vast 
commerce.  Did  you  ever  think  of  this  fact :  that  of  the 
twelve  greatest  seaports  in  the  world,  the  only  one 
accredited  to  the  United  States  is  New  York!  San 
Francisco  with  her  enormous  advantages  is  not  men- 
tioned. That  of  those  twelve,  four  stand  facing  the 
Pacific,  some  of  which  we  scarcely  know,  and  with  all 
of  which  our  trade  is  trivial.  There  is  Hongkong  with 
20.500,000  entered  and  cleared  tons  per  year;  Shanghai 
with  18,500.000  such  tons — two  ports  that  but  for  the 
curvature  of  the  earth  you  might  see  with  a  spy-glass 
from  Telegraph  Hill,  so  straight  do  they  lie  on  a  line 
from  the  top  of  the  Call  Building,  and  yet  what  are  they 
and  their  enormous  traffic  to  us?  Singapore  lies  around 
the  curve  of  Asia  at  the  toe  of  the  Malay  Peninsula, 
almost  within  pistol  shot  of  the  flag  of  the  United  States 
flvins:  over  the  Philippines.  It  has  a  shipping  of  over 
15,000,000  annual  tons.  And  there  is  Colombo?  Who 
in  San  Francisco  ever  heard  of  Colombo?  And  yet 
Colombo  has  fourteen  millions  of  tons  of  annual  traffic 
and  is  the  chief  city  of  Ceylon,  lying  at  the  point  of 
India,  just  south  of  Calcutta,  south  of  Bombay — great 
ports  of  India  whose  trade  naturally  belongs  to  San 
Francisco  as  much  as  to  London  or  Hamburg,  and  yet 
about  which  we  know  little  or  nothing  at  all. 

And  how  can  we  get  this  trade  and  make  San  Fran- 
cisco and  the  ports  of  this  Coast  what  they  ought  to  be? 
By  the  same  process  through  which  our  manufacturers 
can  hold  their  markets  against  the  Easterner,  namely,  by 
the  restoration  of  natural  wages,  wages  which,  let  me 
repeat,  are  determined  by  what  the  product,  sold  in  the 
competitive  market  will  allow  to  wages,  and  by  what  the 
employee  will  be  willing  to  accept  in  view  of  the  offer- 
ings of  other  industry.  This  is  the  simple  rule,  the 
economic  law  from  wiiich  we  have  wandered,  in  involved 
and  intricate  courses,  through  the  maze  of  high  wages, 
short  hours,  limited  output,  indifferent  work,  while  in- 
dustry' is  throttled,  prices  soar,  markets  close,  business 
initiative  fails,  occupation  ceases  for  hundreds  of  thou- 
sands of  men ;  and  we  have  the  over-straining  of  private 
charity,  the  appropriation  of  public  alms,  the  moving  of 
the  State  into  the  control  of  business  which  business  men 
are  pushed  out  of,  and  there  are  calls  for  out  of  work 
pensions,  maternity  pensions,  old  age  pensions,  minimum 

14 


wage,  eight,  six  and  five  hour  laws,  workmen's  compen- 
sation, the  adoption  by  the  State  of  the  laborer  as  a 
ward  and  prosecution  on  his  behalf  of  the  employer  to 
enforce  against  him  the  laborer's  notion  of  his  contract, 
a  development  which  has  caused  thousands  of  employers 
of  one  and  two  men  to  lay  them  off  and  do  the  work 
themselves  or  let  it  go  undone,  and  so  on  and  so  on; 
swarms  of  new  laws,  endless  schemes  of  restriction  and 
compulsion,  unheard  of  commissions,  taxes  without  num- 
ber, burdens  without  limit,  until  business  becomes  a 
thing  that  a  man  would  flee  from  if  he  could  find  a  way 
out,  and  few  would  have  the  hardihbod  to  enter. 

And  yet  notwithstanding  it  must  be  apparent  to  any- 
one who  will  bestow  a  little  thought  upon  the  subject 
that  our  troubles  have  arisen  from  our  forsaking  the 
natural  law  of  wages,  we  find  all  agents  of  the  govern- 
ment, whenever  they  get  into  harness,  running  strongly 
toward  Socialism.  Never  for  a  moment  turning  their 
thoughts  toward  liberty,  to  determine  whether  in  that 
direction  there  may  not  be  some  avenue  of  escape  from 
intolerable  conditions,  they  see  no  way  out  but  by  the 
road  which  leads  to  conversion  of  the  State  into  a 
domestic  overlord.  Their  absence  of  rational  explana- 
tions and  sane  direction  concludes  even  the  great  capi- 
talists like  Daniel  Guggenheim  and  thousands  of  others, 
that  Socialism  is  the  only  possible  refuge,  and  that  it 
must  come  with  whatever  conditions  it  entails.  In  1907 
the  President  appointed,  under  act  of  Congress,  a  com- 
mission to  investigate  the  question  of  immigration.  It 
was  comprised  of  eminent  men,  various  of  them  mem- 
bers of  Congress.  It  spent  three  years  in  the  work,  and 
produced  illimitable  tomes  of  data  and  report.  Little 
that  it  developed  was  new,  and  its  recommendations 
were  worse  than  useless,  in  that  they  called  for  restric- 
tion of  immigration  in  conformity  with  the  doctrines  of 
the  labor  unions.  The  recent  immigration  acts  contain- 
ing the  literacy  test,  now  vetoed  by  three  presidents, 
were  the  outcome  of  these  recommendations.  The  com- 
mission did  not  give  thought  to  analyzing  the  meaning 
of  migration  as  a  natural  law,  whereby  the  error  and 
injury  of  restriction  might  have  been  seen,  as  well  as 
the  folly  of  supposing  that  it  is  an  injury  to  laborers 
already  in  the  country,  but  it  devoted  its  time  to  collect- 
ing and  compiling  facts,  very  voluminous  and  of 
small  account.  Now,  therefore,  after  this  ineffectual 
commission  shall  have  gotten  off  the  ways,  we  have  an- 
other, in  and  about  similar  business;  this  time  the 
Industrial  Relations  Commission  to  which  I  have  re- 
ferred, whereof,  as  I  have  stated,  Mr.  Frank  P.  Walsh 
is  chairman.  This  body  for  two  years  past  has  been 
inquiring  of  all  and  sundry  from  the  four  sides  of  the 
continent  the  cause  of  the  industrial  unrest.  From  such 
lucubrations  as  it  has  evolved  out  of  the  wisdom  of  the 
witness  stand.  Chairman  Walsh  has  quite  definite  notions 
upon  the  subject.  In  a  speech  before  a  New  York 
audience  recently  he  said : 

"We  have  to  realize  in  our  problem  that  toil  and  toil 
alone  produces  wealth;  and  the  toiler  is  no  better  than 
a  slave  unless  he  has  for  himself  a  compelling  voice  in 
fixing  conditions  under  which  he  is  compelled  to  work, 
his  wages,  his  hours  of  labor  and  conditions  as  to  safety 
and  sanitation.  Low  wages  and  the  conditions  that  arise 
from  them  are  at  the  heart  of  our  problems  of  today. 

15 


.  .  .  We  cannot  go  on  with  autocracy  in  business.  The 
fact  that  the  majority  of  the  employing  power  in  Amer- 
ica is  lodged  in  Manhattan  Island  is  a  menace  to  the 
perpetuity  of  our  institutions,  for  it  is  but  a  step  from 
the  autocratic  control' of  industry  to  the  tyrannical  con- 
trol of  government." 

There  can  be  no  question  that  Chairman  Walsh  is  a 
Socialist.  Whether  he  was  such  before  he  accepted  his 
place  on  the  commission,  I  do  not  know.  None  could 
be  farther  wrong  than  he  in  his  utterances.  Wealth  is 
not  produced  by  tajl  or  by  the  toiler;  it  is  produced  by 
mind.  The  toiler  himself  is  useful  just  in  degree  as  li^ 
employs  thought  in  his  work.  VVhethcr  the  toil  1.. 
supplied  by  brawny  arms,  by  the  muscles  of  the  horst., 
or  by  the  swift  whirling  wheels  of  the  mechanism,  it  i>^ 
the  directive  force  that  elicits  the  yield ;  and  if  we  shall 
permit  the  blind  physical  executives  to  overcome  the 
guiding  thought,  there  is  an  end  of  all  order,  and  con- 
fusion pervades.  The  trouble  today  is  that  the  em- 
ployers have  not  control  of  their  conditions'  of  labor. 
The  very  state  of  things  which  have  produced  the 
disturbance  is  what  this  Federal  official  Walsh  wishes 
farther  developed  along  the  lines  which  have  occasioned 
the  damage,  "Ix)w  wages"  is  not  "at  the  heart  of  ou 
problems  today,"  Never  in  the  world's  history,  in  an\ 
nation,  at  any  time,  have  wages  been  so  high — that  is. 
so  much  coin  paid  for  the  work,  and  Chairman  Walsh 
would  have  them  still  higher!  The  trouble,  as  I  hav' 
shown,  is  the  very  converse  of  the  view  he  asserts;  ii 
is  the  resulting  evils  of  artificially  high  w-ages  that  have 
produced  the  prevailing  untoward  result. 

And  when  Mr,  Walsh  succeeds  in  abolishing  "autoc- 
racy in  business."  let  us  then  be  very  sure  that  business 
also  will  be  abolished ;  that  is,  business  as  performed  by 
business  men.  From  thence  on  such  attention  as  it 
receives  will  be  bestowed  by  politicians  in  the  pay  of 
the  State.  The  condition  of  which  Mr.  Walsh  complains 
is  nothing  other  than  the  power  of  the  employer  to  dis- 
charge the  hand  while  continuing  to  conduct  the  busi- 
ness. This  is  the  "industrial  democracy"  to  which  I 
have  heretofore  referred,  as  well  as  to  the  attitude  of 
the  Federal  government,  through  its  Department  of 
Labor,  on  this  question.  It  has  come  to  pass  that  the 
government  steps  forward  and  takes  up  the  cause  of 
one  group  of  citizens  against  another,  not  where  any 
wrong  is  committed  by  those  whom  the  government  thus 
opposes,  but  where  right  only  is  insisted  upon.  It  does 
not  take  a  wise  head  or  a  farseeing  eye  to  perceive  th< 
confusion  and  collapse  that  must  ensue  in  our  affair^ 
and  to  our  nation,  if  principles  such  as  these  are  favored 
to  supplant  those  sound  and  safe  abstractions  upon 
which  that  government  was  installed. 

The  assumption  for  which  Chairman  Walsh  is  now 
engaged  in  creating  public  opinion  has  just  been  pro- 
nounced against  by  the  Supreme  Court  of  the  United 
States,  which  has  vitiated  the  statutes  of  fourteen  States, 
California  among  the  number,  making  it  a  crime  for  an 
employer  to  require  of  an  employee,  as  a  condition  of 
employment,  that  he  would  not  join  a  labor  union.  Six 
justices    stood    for    the    principle    that    the    employee's 

16 


liberty  of  making  amtrac^s 'do€|S' WliiqWde.a  oower  to 
procure  employmetit  against  the  will  oi^  'the  employer. 
The  question  of  what  may,  affect  the  employer's  will  is 
altogether  immaterial.  It  may  be  anything,  legal  or 
illegal.  It  is  sufficient  if,  under  any  condition,  the  em- 
ployer does  not  wish  to  employ  a  man ;  he  is  not  to  be 
by  law  compelled  to  do  so.  Nor  once  having  introduced 
a  man  into  his  service,  is  he  to  be  made  the  victim  of  a 
law  to  force  him  to  continue  such  man  in  his  service 
against  his  will.  Immediately  it  becomes  lawful  for  the 
employee  to  either  enter  or  to  remain  in  the  employer's 
service  contrary  to  the  will  of  the  latter,  that  moment 
is  the  property  of  the  proprietor  confiscated  by  the  State 
and  set  aside  for  the  benefit  of  the  employee,  who  is 
thus  specialized  as  a  class  and  favored  by  the  govern- 
ment as  against  the  rest  of  the  citizenry. 

The  only  remedy  for  the  condition  that  oppresses  all 
industry,  employer  and  employee  alike,  with  its  dread 
consequences  to  society  and  to  the  nation,  is  return  to 
the  principle  of  human  liberty.  There  must  be  recog- 
nized as  the  basis  of  industry  the  inherent  right  of  the 
employer  to  employ  whom  he  will,  when  he  will,  for  as 
long  a  time  as  he  will,  for  what  wages  and  under  what 
shop  conditions  he  will,  and  to  discharge  when  he  will, 
subject  only  to  the  employee's  acceptance  of  the  offer 
of  the  employer,  and  to  the  obligation  of  whatever  con- 
tract there  may  be  made  between  them;  and  all  idea  of 
the  employee  being  the  subject  of  an  oppressive  environ- 
ment that  has  compelled  him  to  accept  the  conditions 
of  the  employer  or  starve,  or  of  the  employer  that  he 
must  have  through  the  arm  of  the  State  a  force  com- 
pelling the  employee  to  continue  a  service  which  he 
becomes  unwilling  to  perform,  doing  this  by  a  power 
chaining  his  body  to  the  job,  when  under  common  law 
he  would  be  guilty  only  of  a  breach  of  contract  answer- 
able in  civil  damages,  all  this  must  be  abandoned,  and 
remedies  for  the  condition  of  things  of  which  the 
parties  complain  must  be  looked  for  in  other  directions. 
The  employee  must  strike  hands  with  the  employer  in 
increasing  jobs;  that  is,  in  increasing  business,  and  must 
turn  thought  to  the  methods  by  which  this  can  be  done. 
It  is  not  to  be  done  by  coordinating  in  the  starting  of 
new  enterprises,  but  by  removing  the  obstacles  which 
exist  in  public  law  and  systems,  labor  union  and  other, 
to  new  business  being  started.  As  business  is  essentially 
service  of  one  man  upon  another,  and  its  extent  held  in 
bounds  only  by  the  ability  of  the  individual  to  render 
service,  so  business  should  at  all  times  exist  in  great 
abundance ;  jobs  should  always  be  calling  for  men  on 
every  hand ;  industry,  as  I  have  elsewhere  said,  should 
be  held  back  by  lack  of  men,  not  by  lack  of  customers, 
as  is  now  the  case. 

How  to  bring  this  about  is  extremely  simple.  It  is 
by  returning  to  the  principle  upon  which  this  nation 
was  founded,  namely,  by  recognizing  that  all  men  are 
equal ;  that  they  each  have  all  rights  up  to  where  the 
exercise  of  such  touches  the  border  of  like  rights  of 
his  neighbor.  That  government  exists  only  for  safe- 
guarding those  rights,  and  its  function  is  to  hold  a 
balance  hand  between  man  and  man.  and  to  maintain 
order,  which  latter  is  care  for  the  public  safety  and  the 
public  health.  That  the  moment  government  steps  over 
these  bounds,  it  invades  the  rights  of  man  and  becomes 

17 


a  tyrant,  and  it  .isj  ^^  fiature  of.  all  tyranny  that  it  ever 
increases  from -oiiirage  to  outrage  until  war  ensues. 
With  the  principle  of  human  liberty  and  equal  right  as 
a  guide,  held  ever  in  hand  as  a  carpenter  his  standard, 
industrialism  may  again  be  made  safe,  and  business 
prosperous ;  while  without  this,  on  the  course  we  are 
now  proceeding,  order  must  dwindle,  chaos  must  super- 
vene and  havoc,  such  as  we  have  already  so  abundantly 
known  in  the  United  States  must  transpire,  only  to  be 
stopped  by  war,  which  is  in  itself  a  kind  of  order — the 
order  of  force  working  to  attain  the  order  of  peace. 


18 


WRITINGS   OF  JOHN  E.   BENNETT 
BOOKLETS 

The  following  are  short  articles  published  in  a  form  to  be 
easily  cajrried  by  the  ordinary  business  envelope,  together 
with   a  letter,    under   a   two-cent   stamp. 

WHAT    WILL    BECOME    OF    BUSINESS? 

Being  an  abridgment  of  the  pamphlet.  THE  INDUSTRIAL 
UNREST,  and  designed  for  use  as  either  an  introduction  to 
the  reading  of  that  paper,  or  as  a  synopsis  of  it  for  the  re- 
quirements of  the  busy  man. 

THE    END    OF    BUSINESS 

A  short  essay  upon  the  passing  of  the  employer's  right  to 
discharge  an  employee,  hence  to  maintain  control  over  his 
business;  the  incident  vesting  in  the  employee  of  a  property 
right  in  the  employer's  establishment  by  virtue  of  the  induc- 
tion of  the  employee  therein,  and  the  attitude  of  the  govern- 
ment of  the  United  States  through  its  Department  of  Labor 
in  reference  to  this  demand.  The  effect  such  principle  must 
have  upon  business  and  statement  of  the  needful  changes  in 
the  industrial  and  political  world  to  restore  freedom  and 
bring   prosperity  to  industry. 

AS  SEEN  IN  AUSTRALASIA 
A  review  of  the  recent  report  of  the  Commission  of  the 
National  Association  of  Manufacturers  upon  "Industrial  Con- 
ditions in  Australasia,"  the  same  being  a  survey  of  the  opera- 
tions of  trades  unionism  and  its  concomitant  legislation  in 
Australia  and  New  Zealand,  with  information  gathered  upon 
the  subject  from  other  sources.  In  these  Colonies  the  trade 
union  principle  is  probably  further  developed  than  in  any 
other  region  of  the  world.  Having  control  of  the  respective 
governments,  the  unions  have  been  able  to  apply  their  doc- 
trines with  the  force  of  law.  All  the  various  legislative  and 
other  schemes  and  expedients  Just  entering  the  domain  of 
business  here,  have  there  been  in  existence  sufficiently  long  to 
test  out  their  value  to  society.  The  result  has  been  a  highly 
increased  degree  of  Industrial  unrest,  incessant  strikes  and 
disturbances,  restricted  development,  slow  growth  and  busi- 
ness stagnation:  the  artificial  increasing  of  wages  correspond- 
ingly raising  the  cost  of  living  with  incidental  widespread  im- 
poverishment, the  workers,  as  stated  by  a  leading  Australian 
economist,  creating  "a  rod  for  their  own  backs."  The  in- 
quiry throws  much  light  upon  the  future  of  California  under 
labor  unionism,  and  emphasizes  the  necessary  relief  to  the 
pressure  of  population  under  prevailing  erroneous  economic 
policies  producing  idle  multitudes  in  a  sparsely  settled  coun- 
try, which  relief  the  existing  European  war  is  affording  to 
Australasia  in  the  decimation  of  her  expeditionary  contingents. 

THE  NEXT  PAMPHLET 
The  forthcoming  pamphlet  is  entitled  War  and  Business.  It 
will  be  a  discussion  presenting  a  solution  of  the  vexed  ques- 
tion of  further  armament  on  part  of  the  United  States,  which 
now  threatens  not  only  to  convert  many  thousands  of  our 
youth  into  soldiers,  burden  business  with  increased  taxes  to 
support  the  waste  of  munitions,  but  is  preparing  the  soil  for 
the  blood  of  our  children,  if  not  of  many  of  ourselves  and  of 
those  who  are  now  our  friends,  clients  and  customers,  whose 
duty  it  will  then  be,  through  no  fault  of  theirs  or  ours,  to 
shoot  us,  and  we  them.  Incidentally,  this  paper  will  present 
what  is  confidently  asserted  as  the  rational  policy  and  deter- 
mination of  the  whole  world's  peace  question,  which  has 
occasioned  so  much  controversy,  without  the  result  of  stopping 
war,  throughout  the  world. 


BUSINESS    MEN'S    ECONOMIC    ASSOCIATIO 
CHAIEMAN.   G.  X.  WENDLING 
VICE-CHAIRMEN 

J.  A.  FOLGER  HENRY   T.   SCOTT  i 

W.   M.   ALEXANDER  JOHN  A.   BRITTOl 

BRACE   HAYDEN  ROBERT   DOLLAR 

W.   H.   TALBOT 

DIRECTORS 

G.  X.  Wendling 
W.  A.  Grubb 
J.  W.  Mason 
Alexander  D.  Keyes 
C.  E.  Green 
Robert  H.  Swayne 
James  H.  Schwabacher 


San  Francisco  Office 
1310-11  Hnmboldt  Bank  Bldg. 


Oakland  Of 
418  Syndicate 


Organized  in  an  endeavor  to  arouse  the  business 
a  consciousness  of  its  peril  in  the  presence  of  the  inJ 
unrest;    to   show   the  cause   of  that  unrest,   and   its   in^ 
culmination   in  the   suppression   of  business   as  a  func 
the  citizen,   and  the  convergence   of  industry  and   affa^ 
the   Socialized    State,   resulting   in   unavertible   war. 
out  the  rational  and  easily  understood  solution  of  this 
tion.  which  abides  in  a  change  of  certain  public  laws, 
resisting  certain   policies   of  labor  unions;   and  to  educ 
public    in   bringing    these   changes    about,    which    will 
business  from   the   restrictions  which   hamper   and   pre^ 
transactions,    thereby    calling   into   existence   a    state 
business  and  industrial  activity,   making  wealth  abund] 
distribution  just,  securing  the  inviolability  of  property 
hands  of  its  owners,  and  insuring  continuous  peace  ai 
4uility. 


Excerpt  from  the  By-Laws  of  the 

BUSINESS    MEN'S    ECONOMIC    ASSOCIATIOl 

Membership  of  this  Association  shall  be  three  kinc 

Full  membership,   the  fee  for  which  is   $10.00   per 
and  shall   entitle  the   holder  to  free  receipt  of  all  lit 
and    free    admission    for    himself    and    family    to    all 
issued  or  delivered  by  the  Association. 

Club  membership,  the  fee  for  which  is  $2.00  per  yc 
entitles  the  holder  to  free   receipt   of  all  literature  issj 
the  Association  and  to  admission  to  all  lectures  upon 
of    one-half   the    regular    price.      Club    members    are 
only  in  those  cases  where  at  least  one  full  membership 
in  the  Association  by  the  corporation,  firm  or  house  ir 
the  proposed  Club  member  is  employed. 

Professional  membership,  the  fee  for  which  is  $5. 
year,  is  limited  to  members  of  the  professions,  and  entitj 
holder  to  free  receipt  of  all  Association  literature  "^ 
attendance  upon  all  lectures. 


Gaylord  Br 
Makers 
Syracuse,  N 
PfcT.JAK.21,  19 


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